Health Care Week in Review: CMS Releases Advance Notice of MA and Part D Payment Methodologies and Senate Finance Chair Identifies Key Priorities

Below is Alston & Bird’s Health Care Week in Review, which provides a synopsis of the latest news in health care regulations, notices, and guidance; federal legislation and congressional committee action; reports, studies, and analyses; and other health policy news.

Week in Review Highlight of the Week:

This week, CMS released the Advance Notice of MA capitation rates and Part C and D payment policies and Senate Finance Chair Mike Crapo (R-ID) identified his key priorities for the 119th Congress.

I. Regulations, Notices & Guidance

• On January 3, 2025, the National Institutes of Health (NIH) released a notice entitled, Statement of Organization, Functions, and Delegations of Authority. The NIH All of Us Research Program has modified its organizational structure. The new organizational structure was approved by the Secretary of Health and Human Services (HHS) on December 19, 2024.
• On January 6, 2025, the Food and Drug Administration (FDA) released draft guidance entitled, Accelerated Approval and Considerations for Determining Whether a Confirmatory Trial is Underway; Draft Guidance for Industry; Availability. For drugs granted accelerated approval, sponsors conduct confirmatory studies that must be completed post approval to verify and describe the anticipated effect on irreversible morbidity or mortality or other clinical benefit. This draft guidance describes FDA’s interpretation of the term “underway” and discusses policies for implementing this requirement, including factors FDA intends to consider when determining whether a confirmatory trial is underway prior to accelerated approval.
• On January 6, 2025, FDA released draft guidance entitled, Artificial Intelligence-Enabled Device Software Functions: Lifecycle Management and Marketing Submission Recommendations; Draft Guidance for Industry and Food and Drug Administration Staff; Availability. This draft guidance, if finalized, would provide recommendations regarding the contents of marketing submissions for devices that include artificial intelligence (AI)-enabled device software functions including documentation and information that would support FDA’s evaluation of safety and effectiveness. To support the development of appropriate documentation for FDA’s assessment of the device, this draft guidance also proposes recommendations for the design, development, and implementation of AI-enabled devices that sponsors may wish to consider using throughout the total product lifecycle (TPLC). This draft guidance is not final nor is it for implementation at this time.
• On January 6, 2025, FDA released final guidance entitled, Communications From Firms to Health Care Providers Regarding Scientific Information on Unapproved Uses of Approved/Cleared Medical Products: Questions and Answers; Guidance for Industry; Availability; Agency Information Collection Activities; Submission for Office of Management and Budget Review; Comment Request. This guidance describes FDA’s enforcement policy regarding certain firm-initiated communications of scientific information on unapproved use(s) of the firm’s approved/cleared medical products to health care providers (HCPs) engaged in prescribing or administering medical products to individual patients. This guidance finalizes the revised draft guidance of the same title issued in October 2023. The October 2023 revised draft guidance revised and replaced the draft guidance entitled, Distributing Scientific and Medical Publications on Unapproved New Uses—Recommended Practices, issued in March 2014, which revised the final guidance entitled Good Reprint Practices for the Distribution of Medical Journal Articles and Medical or Scientific Reference Publications on Unapproved New Uses of Approved Drugs and Approved or Cleared Medical Devices, issued in January 2009. This guidance is not for current implementation, pending the Office of Management and Budget’s (OMB’s) decision on the collection of information.
• On January 6, 2025, FDA released draft guidance entitled, Considerations for Including Tissue Biopsies in Clinical Trials; Draft Guidance for Industry, Investigators, Institutions, and Institutional Review Boards; Availability. This guidance provides recommendations regarding considerations for tissue biopsies that may be conducted in adults and in children as part of clinical trials evaluating investigational medical products and/or that are conducted or supported by HHS.
• On January 6, 2025, FDA released draft guidance entitled, Considerations for the Use of Artificial Intelligence To Support Regulatory Decision-Making for Drug and Biological Products; Draft Guidance for Industry; Availability; Comment Request. In accordance with its mission of protecting, promoting, and advancing public health, FDA’s Center for Drug Evaluation and Research (CDER), in collaboration with the Center for Biologics Evaluation and Research (CBER), the Center for Devices and Radiological Health (CDRH), the Center for Veterinary Medicine (CVM), the Oncology Center of Excellence (OCE), the Office of Combination Products (OCP), and the Office of Inspections and Investigations (OII), is issuing this draft guidance to provide recommendations to industry on the use of AI to produce information or data intended to support regulatory decision-making regarding the safety, effectiveness, or quality for drug and biological products.
• On January 6, 2025, FDA released draft guidance entitled, Evaluation of Sex-Specific and Gender-Specific Data in Medical Device Clinical Studies; Draft Guidance for Industry and Food and Drug Administration Staff; Availability. This document provides guidance on the study and evaluation of sex- and/or gender-specific data in clinical investigations or research involving one or more subjects to determine the safety or effectiveness of a device. The purpose of this guidance is to encourage science-driven consideration of sex and/or gender, as appropriate for both the scientific question being addressed and the intended use of the device, when designing medical device clinical studies and reporting data from such studies in accordance with legal requirements. This draft guidance is not final nor is it for implementation at this time.
• On January 6, 2025, FDA released final guidance entitled, Interim Policy on Compounding Using Bulk Drug Substances Under Section 503B of the Federal Food, Drug, and Cosmetic Act; Guidance for Industry; Availability. This guidance describes FDA’s interim regulatory policy concerning compounding by outsourcing facilities using bulk drug substances while FDA develops the list of bulk drug substances that outsourcing facilities can use in compounding under the applicable section of the Food, Drug, and Cosmetic Act (FD&C Act). This guidance finalizes the draft guidance of the same title issued in December 2023 and replaces the final guidance of the same title issued in January 2017.
• On January 6, 2025, FDA released final guidance entitled, Notifying the Food and Drug Administration of a Permanent Discontinuance or Interruption in Manufacturing of a Device Under Section 506J of the Federal Food, Drug, and Cosmetic Act; Guidance for Industry and Food and Drug Administration Staff; Availability. This guidance updates the previous version of the guidance, of the same title, issued on November 17, 2023, and finalizes the concurrently issued draft guidance entitled, Select Updates for the 506J Guidance: 506J Device List and Additional Notifications. This guidance finalizes a list of device product codes for which a manufacturer of such devices is required to notify FDA in accordance with the FD&C Act and clarifies that manufacturers may submit voluntary notifications regarding supply chain issues at any time, unrelated to the declaration or potential declaration of a public health emergency (PHE).
• On January 6, 2025, FDA released draft guidance entitled, Pulse Oximeters for Medical Purposes - Non-Clinical and Clinical Performance Testing, Labeling, and Premarket Submission Recommendations; Draft Guidance for Industry and Food and Drug Administration Staff; Availability. This draft guidance document, if finalized, would provide recommendations regarding nonclinical and clinical performance testing of certain pulse oximeters for medical purposes, including devices with a pulse oximeter function that estimates the amount of oxygen in arterial blood and pulse rate. These recommendations are being proposed based in part on concerns that the accuracy of pulse oximeters can be affected by, among other factors, a person’s skin pigmentation. The recommendations are being proposed to inform the performance evaluation for these devices, to support premarket submissions, regardless of submission type, and to promote consistency and facilitate efficient review of these submissions. Among other topics, the draft guidance also proposes recommendations for labeling, which are intended to promote the safe and effective use of pulse oximeters and help users understand the benefits and risks associated with the use of the device. This draft guidance is not final nor is it for implementation at this time.
• On January 6, 2025, FDA released draft guidance entitled, Recommendations for Determining Eligibility of Donors of Human Cells, Tissues, and Cellular and Tissue-Based Products; Draft Guidance for Industry; Availability. This draft guidance document includes general information on determining eligibility for donors of human cells, tissues, and cellular and tissue-based products (HCT/Ps). In addition, FDA intends to issue separate guidance documents with recommendations regarding reducing the risk of transmission of specific communicable disease agents and diseases for donors of HCT/Ps. These guidance documents are intended to update an existing guidance.
• On January 6, 2025, FDA released final guidance entitled, Recommendations To Reduce the Risk of Transmission of Disease Agents Associated with Sepsis by Human Cells, Tissues, and Cellular and Tissue-Based Products; Guidance for Industry; Availability. FDA is issuing this guidance to provide establishments making donor eligibility determinations with recommendations to reduce the risk of transmission of infections due to sepsis by HCT/Ps. This guidance is being issued to respond to a public health safety concern and to address the urgent need for updated recommendations in making a donor eligibility determination when screening a donor for clinical evidence of sepsis and clinical signs to consider.
• On January 6, 2025, FDA released final guidance entitled, Recommendations To Reduce the Risk of Transmission of Mycobacterium Tuberculosis by Human Cells, Tissues, and Cellular and Tissue-Based Products; Guidance for Industry; Availability. FDA is issuing this guidance to assist establishments that make donor eligibility determinations for donors of HCT/Ps, with recommendations for screening donors for evidence of, and risk factors for, infection with Mycobacterium tuberculosis (Mtb), the organism that causes tuberculosis. The guidance also recommends additional steps that HCT/P establishments should take to reduce risk of transmission of Mtb until such time as appropriate FDA-licensed, approved, or cleared donor screening tests are available for use to test donors for Mtb infection. The guidance identifies Mtb as a relevant communicable disease agent or disease (RCDAD) and supplements the recommendations contained in other donor eligibility guidance documents for donors of HCT/Ps. This guidance is being issued to address the urgent public health need to reduce the risk of transmission of Mtb by HCT/Ps.
• On January 6, 2025, FDA released draft guidances entitled, Draft Guidances Relating to Recommendations to Reduce the Risk of Transmission of Relevant Communicable Disease Agents and Diseases by Human Cells, Tissues, and Cellular and Tissue-Based Products; Draft Guidances for Industry; Availability. These draft guidances are intended to update existing guidances and to assist establishments making donor eligibility determinations in understanding the requirements for determining donor eligibility, including donor screening and testing, for donors of HCT/Ps. These draft guidances are also intended to provide establishments making donor eligibility determinations with recommendations to reduce the risk of transmission of specific communicable disease agents and diseases, specifically, hepatitis B virus (HBV), hepatitis C virus (HCV), and human immunodeficiency virus (HIV), by HCT/Ps.
• On January 6, 2025, FDA released final guidance entitled, Validation and Verification of Analytical Testing Methods Used for Tobacco Products; Guidance for Industry; Availability. The guidance provides information and recommendations related to the validation and verification of analytical test methods, including analytical testing of tobacco product constituents, ingredients, and additives, as well as stability testing of tobacco products. This guidance is intended to help industry produce more consistent and reliable analytical data used to support regulatory submissions for finished tobacco products. This guidance finalizes the draft guidance of the same title issued in December 2021.
• On January 6, 2025, FDA released draft guidance entitled, Validation of Certain In Vitro Diagnostic Devices for Emerging Pathogens During a Section 564 Declared Emergency; Draft Guidance for Industry and Food and Drug Administration Staff; Availability. The draft guidance describes general recommendations for the validation of in vitro diagnostic devices (IVDs) for emerging pathogens during an applicable declaration of a PHE. This guidance and the associated template include the recommendations that apply to test data and information submitted in a pre-Emergency Use Authorization (EUA), an EUA request, or to a test offered as described in an applicable enforcement discretion policy. This draft guidance is not final nor is it for implementation at this time.
• On January 7, 2025, HHS released a notice entitled, Center for Indigenous Innovation and Health Equity Tribal Advisory Committee; Solicitation of Nominations for Delegates. The Office of Minority Health (OMH) hereby gives notice that OMH is accepting nominations of candidates to serve as primary and alternate delegates for the Center for Indigenous Innovation and Health Equity Tribal Advisory Committee (CIIHE TAC).
• On January 7, 2025, FDA released draft guidance entitled, Developing Drugs for Optical Imaging; Draft Guidance for Industry; Availability. The purpose of this guidance is to provide recommendations to sponsors regarding clinical trial design features that support development and approval of optical imaging drugs that are used in conjunction with imaging devices and intended as intraoperative aids for the detection of pathology such as tumors or to enhance the conspicuity of normal anatomical structures.
• On January 7, 2025, FDA released draft guidance entitled, Obesity and Overweight: Developing Drugs and Biological Products for Weight Reduction; Draft Guidance for Industry; Availability. This draft guidance provides recommendations to industry regarding the development of drugs and biological products regulated within CDER intended for reduction and long-term maintenance of body weight in patients with obesity or overweight. This draft guidance revises and replaces the draft guidance for industry, Developing Products for Weight Management, issued in February 2007.
• On January 8, 2025, HHS released a notice entitled, Statement of Organization, Functions, and Delegations of Authority. HHS, Office of the Secretary (OS), Office of the Assistant Secretary for Administration (ASA) has modified its organizational structure. This notice provides an updated Statement of Organization, Functions, and Delegations of Authority for the Office of the Assistant Secretary for Administration, last amended at 82 FR 49385, dated October 25, 2017. The statement fully replaces Part A, Chapter AJ, and Part P and supersedes all previous Statements of Organization, Functions, and Delegations of Authority related to ASA.
• On January 8, 2025, HHS released a notice entitled, Office of Minority Health, Organizational Structure. This notice provides an update to the organizational structure for HHS, OS, OMH. OMH has changed the name of the Division of Information and Education (DIE), as noted in an April 11, 1995 Federal Register Notice, to the Division of Strategic Communication and Community Engagement (DCE). This name change better aligns with the functions of the division and provides for a more socially acceptable acronym. The functions of the division are unchanged from the April 11, 1995 Federal Register Notice.
• On January 8, 2025, the Administration for Children and Families (ACF) released a notice entitled, Amendment of the Statement of Organizations, Functions and Delegation of Authority. ACF is amending the Statement of Organization, Functions and Delegation of Authority (“Statement”) issued in the Federal Register on April 28, 2009. The Statement delegated specific provisions of the William Wilberforce Trafficking Victims Protection Reauthorization Act of 2008, Public Law 110-457, section 235 from the Assistant Secretary for Children and Families to the Director of the Office of Refugee Resettlement (ORR). This amendment modifies the Statement to authorize the Director of the ORR to redelegate the listed authorities contained within the Statement.
• On January 8, 2025, FDA released a notice entitled, Notice of Approval of Product Under Voucher: Rare Pediatric Disease Priority Review Voucher; ALYFTREK (vanzacaftor, tezacaftor, and deutivacaftor). FDA is announcing the issuance of approval of a product redeeming a priority review voucher. The FD&C Act authorizes FDA to award priority review vouchers to sponsors of approved rare pediatric disease product applications that meet certain criteria. FDA is required to publish notice of the issuance of priority review vouchers as well as the approval of products redeeming a priority review voucher. FDA has determined that the application for ALYFTREK (vanzacaftor, tezacaftor, and deutivacaftor), approved December 20, 2024, meets the criteria for redeeming a priority review voucher.
• On January 8, 2025, released a notice entitled, Advisory Committee; Antimicrobial Drugs Advisory Committee; Renewal. FDA is announcing the renewal of the Antimicrobial Drugs Advisory Committee by the Commissioner of Food and Drugs (the Commissioner). The Commissioner has determined that it is in the public interest to renew the Antimicrobial Drugs Advisory Committee for an additional two years beyond the charter expiration date. The new charter will be in effect until the October 7, 2026, expiration date.
• On January 8, 2025, FDA released a request for comments entitled, National Antimicrobial Resistance Monitoring System 2026-2030 Strategic Plan; Request for Comments. is soliciting comments from the public regarding the National Antimicrobial Resistance Monitoring System (NARMS) 2026-2030 Strategic Plan. Comments received will help inform the development of a draft 2026-2030 Strategic Plan, to be discussed at a public meeting in spring 2025. Specific questions and information requests are included in this notice to help guide input from interested parties.
• On January 8, 2025, FDA released a notice entitled, Issuance of Priority Review Voucher; Rare Pediatric Disease Product; CRENESSITY (crinecerfont). FDA is announcing the issuance of a priority review voucher to the sponsor of a rare pediatric disease product application. The FD&C Act authorizes FDA to award priority review vouchers to sponsors of approved rare pediatric disease product applications that meet certain criteria. FDA is required to publish notice of the award of the priority review voucher. FDA has determined that CRENESSITY (crinecerfont), approved on December 13, 2024, manufactured by Neurocrine Biosciences, Inc., meets the criteria for a priority review voucher.
• On January 8, 2025, FDA released a notice entitled, Request for Nominations for Voting Members on a Public Advisory Committee; Technical Electronic Product Radiation Safety Standards Committee. FDA is requesting nominations for voting members to serve on the Technical Electronic Product Radiation Safety Standards Committee (TEPRSSC) in the Center for Devices and Radiological Health. Nominations will be accepted for current and upcoming vacancies effective January 1, 2025, with this notice. FDA seeks to include the views of women and men, members of all racial and ethnic groups, and individuals with and without disabilities on its advisory committees and, therefore, encourages nominations of appropriately qualified candidates from these groups.
• On January 10, 2025, the Substance Abuse and Mental Health Services Administration (SAMHSA) released a notice entitled, Fiscal Year (FY) 2025 Notice of Supplemental Funding Opportunity. This notice informs the public that SAMHSA is supporting administrative supplements in scope of the parent award for the five (5) eligible grant recipients funded under FY 2020 National Consumer and Consumer Supporter Technical Assistance Centers, Notice of Funding Opportunity (NOFO) SM-20-001. The total available funding is $1,806,000 and each of the five recipients may receive up to $361,200. This supplemental funding will extend the project period by 12 months to March 30, 2026, as SAMHSA completes the Agency’s efforts to update the program for the field’s current needs. Recipients will use the funding to continue to provide technical assistance to promote evidence-based care for adults with serious mental illness within the scope of their active grant award.

Event Notices

January 7, 2025: HHS announced a meeting of the Advisory Committee on Minority Health. This is a virtual meeting open to the public.

January 7, 2025: The Small Business Administration (SBA) announced a meeting of the National Women’s Business Council. This is an in-person meeting open to the public.

January 13, 2025: NIH announced a meeting of the National Advisory Child Health and Human Development Council. This is a virtual meeting open to the public.

January 16, 2025: HHS announced a meeting of the Advisory Committee on Minority Health. This is a virtual meeting open to the public.

January 23, 2025: NIH announced a meeting of the National Deafness and Other Communication Disorders Advisory Council. This is a virtual meeting with one session open to the public.

January 23, 2025: The Health Resources and Services Administration (HRSA) announced a meeting of the Secretary’s Advisory Council on Blood Stem Cell Transplantation (ACBSCT). This is a virtual meeting open to the public.

January 27, 2025: NIH announced a meeting of the National Advisory Allergy and Infectious Diseases Council. This is a virtual meeting with some sessions open to the public.

January 28, 2025: NIH announced a meeting of the National Arthritis and Musculoskeletal and Skin Diseases Advisory Council. This is an in-person meeting open the public.

January 28, 2025: NIH announced a meeting of the National Advisory Council for Nursing Research. This is an in-person meeting open to the public.

January 29-39, 2025: HRSA announced a meeting of the Advisory Commission on Childhood Vaccines. This is a virtual meeting open to the public.

February 5, 2025: FDA announced a joint public meeting of the Drug Safety and Risk Management Advisory Committee and the Anesthetic and Analgesic Drug Products Advisory Committee. This is a hybrid meeting open to the public.

February 6, 2025: CMS announced a meeting of the Advisory Panel on Outreach and Education (APOE). This is a virtual meeting open to the public.

February 10, 2025: NIH announced a meeting of the National Advisory Council for Human Genome Research. This is a virtual meeting open to the public.

February 11-12, 2025: The Centers for Disease Control and Prevention (CDC) announced a meeting of the Association of Public Health Laboratories (APHL) entitled, Establishing a Road Map for Accelerated Diagnosis and Treatment of HCV Infection in the United States. This is a virtual meeting open to the public.

February 26-28: CDC announced a meeting of the Advisory Committee on Immunization Practices (ACIP). This is a virtual meeting open to the public.

March 5-6, 2025: HRSA announced a meeting of the National Advisory Council on Nurse Education and Practice (NACNEP). This is a hybrid meeting open to the public.

March 27-28, 2025: HRSA announced a meeting of the Advisory Committee on Training in Primary Care Medicine and Dentistry (ACTPCMD). This is a hybrid meeting open to the public.

April 3, 2025: NIH announced a meeting of the Board of Scientific Counselors for the National Institute of Diabetes and Digestive and Kidney Diseases. This is a hybrid meeting open to the public.

April 10-11, 2025: HRSA announced a meeting of the Council on Graduate Medical Education (COGME). This is a hybrid meeting open to the public.

April 30, 2025: NIH announced a meeting of the National Library of Medicine Board of Scientific Counselors. This is a hybrid meeting with some sessions open to the public.

May 14, 2025: HRSA announced a meeting of the National Advisory Council on Nurse Education and Practice (NACNEP). This is a hybrid meeting open to the public.

May 14, 2025: NIH announced a meeting of the National Advisory Council on Aging. This is an in-person meeting with one session open to the public.

June 3-4, 2025: FDA announced a public workshop entitled, Fiscal Year (FY) 2025 Generic Drug Science and Research Initiatives Workshop. This is a hybrid workshop open to the public.

August 6-7, 2025: HRSA announced a meeting of the National Advisory Council on Nurse Education and Practice (NACNEP). This is a hybrid meeting open to the public.

August 8, 2025: HRSA announced a meeting of the Advisory Committee on Training in Primary Care Medicine and Dentistry (ACTPCMD). This is a hybrid meeting open to the public.

September 11-12, 2025: HRSA announced a meeting of the Council on Graduate Medical Education (COGME). This is a hybrid meeting open to the public.

December 4-5, 2025: HRSA announced a meeting of the National Advisory Council on Nurse Education and Practice (NACNEP). This is a hybrid meeting open to the public.

II. Reports, Studies, & Analyses

• On January 7, 2025, the Senate Budget Committee released a report entitled, Profit Over Patients: The Harmful Effects of Private Equity on the U.S. Health Care System.  The report includes the findings from a year-long investigation by Committee staff on the impact of PE investment in health care. According to the Committee, the investigation found that PE ownership of hospitals can lead to significant negative consequences for patient care, hospital operations, and financial stability. The report includes details on how—in some cases—PE investors failed to meet key commitments related to hospital growth, physician recruitment, and maintaining adequate care standards. Investigators found that these failures often resulted in issues such as understaffing and operational challenges, which in turn contributed to a decline in patient care. In some instances, these conditions were linked to serious health and safety violations. According to the Committee, PE firms often incentivized hospital management to focus on financial goals, such as cost-cutting and increasing patient volume, with little attention given to improving or maintaining the quality of care. The Committee also found that PE investors continued to receive large dividends while hospitals reported struggles with debt and operational instability. The report states that the emphasis on profit over patient outcomes contributed to chronic understaffing, facility closures, and financial distress at several hospitals.
• On January 8, 2025, the U.S. Government Accountability Office (GAO) released a report entitled, Older Americans: HHS Should Apply Leading Practices as It Coordinates Overlapping Programs. The report examines the coordination of services for older adults, with a focus on how HHS manages overlap between multiple federal programs. According to the report, older adults often require services such as meal programs and in-home care, and the demand for these services is increasing as the population ages. While many federal programs provide similar services under the Older Americans Act (OAA) and other legislation, the report found that these programs typically do not duplicate each other. Instead, they serve different populations, offer varying services, or have distinct goals, with some overlap providing beneficial complementary services. The report notes that while overlap can be helpful, it is essential that it is managed effectively to ensure efficiency. The report also highlights best practices for interagency collaboration, such as defining common goals and ensuring accountability. GAO recommends that the Administration for Community Living (ACL) develop a written plan that incorporates these practices to improve coordination and reduce fragmentation in services. HHS concurred with the recommendation and stated plans to create a new strategy with input from the Interagency Coordinating Committee on Healthy Aging and Age-Friendly Communities.
• On January 6, 2025, the Kaiser Family Foundation (KFF) released a brief entitled, Community Health Center Patients, Financing, and Services. The brief examines trends in community health center (CHC) patient demographics and insurance coverage, as well as services provided by the CHC, in 2023. KFF found that the number of patients served by a CHC in 2023 rose by about 500,000 to a total of 31 million individuals. The number of children served by a CHC also rose but remains below pre-pandemic levels and may reflect a continued reduction in primary and preventative services utilization for children on Medicaid. KFF reports that 90 percent of CHC patients were at or below 200 percent of the federal poverty level, and 51 percent of patients were covered by Medicaid, an increase from 49 percent in 2022. This increase may be due to the Medicaid continuous enrollment provision in effect during the COVID-19 PHE. The report found that Medicaid ultimately accounted for 43 percent of CHC revenue in 2023, for a total of $46.7 billion and a slight increase from 2022, but net margins for CHCs after costs fell precipitously from 4.5 percent in 2022 to 1.6 percent in 2023, largely due to the expiration of COVID-related funding. Additionally, 13 percent of visits were provided via telehealth in 2023, a continuation of a steady decrease from a peak of 25 percent of visits in 2020.

III. Other Health Policy News

• On January 10, 2025, CMS released the Calendar Year (CY) 2026 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies (CY 2026 Advance Notice) concurrently with the Draft CY 2026 Part D Redesign Program Instructions (Draft CY 2026 Program Instructions). The proposed policies in the CY 2026 Advance Notice are projected to result in a net increase of 4.33 percent, or over $21 billion, in MA payments to plans from 2025 to 2026. CMS is also proposing to complete its implementation of a three-year phase-in of improvements to the MA risk adjustment model and growth rate calculation related to medical education costs. CMS further proposed updates to reflect the Part D redesign as required by the Inflation Reduction Act of 2022 (IRA). The Draft CY 2026 Part D Redesign Program Instructions continue implementation of the redesign of the Medicare Part D program; annual out-of-pocket costs will be capped at $2,100 in 2026 for people with Medicare. Comments on the CY 2026 Advance Notice are due on February 10, 2025. CMS will publish the final Rate Announcement on or before April 7, 2025. The 2026 Advance Notice is available here. The press release is available here. The 2026 Medicare Advantage and Part D Advance Notice Fact Sheet is available here. The Draft CY 2026 Part D Redesign Program Instructions Fact Sheet is available here.
• On January 10, 2025, the House Budget Committee released a 10-year fiscal blueprint, outlining proposed reforms and spending caps aimed at balancing the federal budget, reducing deficits, and achieving economic stability. The plan seeks to balance the federal budget within 10 years, cutting deficits by $14.2 trillion, and lowering the debt-to-gross domestic product (GDP) ratio by more than 40 percentage points compared to current projections. A central aspect of the plan is reducing discretionary spending, projected to save $2.5 trillion over the next decade.
• Health-related reforms represent a significant portion of the savings, targeting $8.7 trillion in mandatory spending reductions over the next 10 years. For Medicare, the Committee seeks $486 billion in savings by introducing efficiency measures that reduce administrative and service delivery costs. Key reforms include implementing site-neutral payments for the same services provided in different healthcare settings, ensuring the government pays the same rate for those services, regardless of the setting. The Committee also addresses hospital uncompensated care payments, bad debt, and graduate medical education (GME) funding. The proposal also includes dismantling the IRA, including reducing enhanced Affordable Care Act (ACA) subsidies.
• In Medicaid, the Committee targets $2.2 trillion in savings through reforms to increase state flexibility while ensuring sustainable program growth through per-capita caps, which would limit federal funding based on the number of enrollees in each state. The plan also includes work requirements for able-bodied adults and seeks to equalize the Federal Medical Assistance Percentage (FMAP) for Medicaid expansion under the ACA, ending higher federal reimbursement rates for states that expanded Medicaid. Other reforms include blocking eligibility rule changes proposed under the Biden Administration and eliminating special FMAP treatment for Washington, D.C. Beyond healthcare, the Committee includes in the blueprint several initiatives designed to reduce waste, fraud, and promote economic growth. It targets a 50 percent reduction in improper payments, which is expected to save $1 trillion over the next decade, and this would be achieved through improved data sharing and stronger eligibility verification across federal programs. Welfare reforms, projected to save $800 billion, would tighten work requirements for Medicaid and food assistance recipients and make changes to the Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF).
• On December 27, 2024, the HHS Office of Civil Rights (OCR) released a proposed rule that updates the Health Insurance Portability and Accountability Act (HIPAA) Security Rule, which establishes the cybersecurity protections a health care provider must maintain to comply with HIPAA. OCR is proposing these updates in response to significant increases in large scale data breaches and cyberattacks in the health care sector over the last five years. The proposed rule would require covered health care entities to adopt more stringent cybersecurity measures than previously required, including encrypting all electronic personal health information (ePHI), even when not in active transit, deploying anti-malware software on all technology, using multi-factor authentication, annually training staff and conducting stress testing of security protocols, and maintaining technology asset inventories and network maps. The rule also requires that both covered entities and business associates develop detailed contingency plans and notify each other no less than 24 hours following activation of such plan. OCR also clarifies that these requirements apply to all ePHI, rather than a specific subset. Comments on the proposed rule are due on or before March 7, 2025. The full proposed rule can be found here and a fact sheet from HHS can be found here. An advisory document from Alston & Bird LLP discussing what this rule could mean for health care organizations can be found here.
• On January 7, 2025, the Consumer Financial Protection Bureau (CFPB) finalized a rule prohibiting the inclusion of medical debt in credit reports, as well as the usage of any medical information in lending decisions. CFPB issued a statement citing prior CFPB research that showed there was little correlation between medical debt and an individual’s ability to pay other loans. CFPB’s statement also highlighted frequent reports of consumers being presented with inaccurate or fraudulent medical bills for services that either were not provided or should have been covered by insurance or financial assistance programs. On January 8, 2025, two trade groups representing the credit reporting and credit union industries filed a lawsuit challenging the final rule on the grounds that it violates the Fair Credit Reporting Act (FCRA).  This final rule will go into effect 60 days after it is published in the Federal Register, likely in early or mid-March. The full rule can be found here, and CFPB’s full statement can be found here.
• On January 7, 2025, Senator Mike Crapo (R-ID) was named Chairman of the Senate Finance Committee for the 119th Congress, a key position overseeing more than 50 percent of the federal budget and has jurisdiction over federal tax policy; federal social safety net and health care programs, including Social Security, Medicare and Medicaid; and implementation of foreign trade agreements. In a press release, Chairman Crapo outlined priorities for the Committee, including expanding access to affordable health care, advancing pro-growth tax policies, and enhancing U.S. global trade competitiveness. Health care priorities include improvements in primary care and chronic care management through stable and streamlined clinician payment, incentives for alternative payment models, and chronic care benefits in Medicare. Chairman Crapo emphasized Committee efforts to improve rural health care access, enhance telehealth and mental health services, and prevent rural hospital closures. Additionally, he highlighted the need for reform in the PBM system, with a focus on reducing consumer costs and improving financial stability for pharmacies. The Committee will work to modernize Medicare’s prescription drug benefits to deliver savings for both patients and taxpayers. Additionally, he stressed the importance of maintaining U.S. leadership in biopharmaceutical innovation, noting the competitive threat posed by countries like China. Chairman Crapo emphasized that the Committee will also closely examine the IRA and seek to mitigate its potential negative impacts on patients, innovators, and taxpayers. A press release with more information is available here.

View our Health Care Legislative & Public Policy team.

Did you miss a week? Browse our Health Care Week in Review archive.